Correlation Between Brookfield Infrastructure and Intact Financial
Can any of the company-specific risk be diversified away by investing in both Brookfield Infrastructure and Intact Financial at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Brookfield Infrastructure and Intact Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Infrastructure Partners and Intact Financial Corp, you can compare the effects of market volatilities on Brookfield Infrastructure and Intact Financial and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Brookfield Infrastructure with a short position of Intact Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Infrastructure and Intact Financial.
Diversification Opportunities for Brookfield Infrastructure and Intact Financial
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brookfield and Intact is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Infrastructure Part and Intact Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intact Financial Corp and Brookfield Infrastructure is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Brookfield Infrastructure Partners are associated (or correlated) with Intact Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intact Financial Corp has no effect on the direction of Brookfield Infrastructure i.e., Brookfield Infrastructure and Intact Financial go up and down completely randomly.
Pair Corralation between Brookfield Infrastructure and Intact Financial
Assuming the 90 days trading horizon Brookfield Infrastructure Partners is expected to generate 1.24 times more return on investment than Intact Financial. However, Brookfield Infrastructure is 1.24 times more volatile than Intact Financial Corp. It trades about 0.07 of its potential returns per unit of risk. Intact Financial Corp is currently generating about 0.05 per unit of risk. If you would invest 1,663 in Brookfield Infrastructure Partners on September 14, 2024 and sell it today you would earn a total of 702.00 from holding Brookfield Infrastructure Partners or generate 42.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brookfield Infrastructure Part vs. Intact Financial Corp
Performance |
| Timeline |
| Brookfield Infrastructure |
| Intact Financial Corp |
Brookfield Infrastructure and Intact Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Infrastructure and Intact Financial
The main advantage of trading using opposite Brookfield Infrastructure and Intact Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Infrastructure position performs unexpectedly, Intact Financial can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Intact Financial will offset losses from the drop in Intact Financial's long position.| Brookfield Infrastructure vs. Canlan Ice Sports | Brookfield Infrastructure vs. Forsys Metals Corp | Brookfield Infrastructure vs. Metalero Mining Corp | Brookfield Infrastructure vs. Ramp Metals |
| Intact Financial vs. Brookfield Infrastructure Partners | Intact Financial vs. Brookfield Infrastructure Partners | Intact Financial vs. iShares Canadian HYBrid | Intact Financial vs. Solar Alliance Energy |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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